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Trial and Error

Jobs Announces iTunes Movie Rentals at MacWorld

January 15, 2008 11:22 AM

For exclusive video from MacWorld, click here.

In a sweeping move to capture the online movie rental market, Apple announced the availability of movie rentals on its iTunes service starting today with movies from all the major Hollywood studios.

Apple CEO Steve Jobs introduced the new offering during his keynote address at MacWorld in San Francisco on Tuesday.

Films from Paramount, Warner Bros., New Line Cinema, Universal, 20th Century Fox, Sony Pictures, Walt Disney, Touchstone, Miramax, MGM and Lionsgate now are available to rent on the iTunes service.

New releases will be available on the service 30 days after their DVD release, he said. Films currently on the new service include recent hits “Knocked Up,” “Ratatouille” and “Blades of Glory” as well as library titles such as “The Matrix.”

Apple is aiming to dominate the online movie business as it has done with online TV downloads and music. Apple will compete with services such as CinemaNow, Vongo and MovieLink, but none of those offerings has achieved much commercial traction.

Download-to-own services, which allow consumers to own a digital copy of a film, also have failed to take off. Wal-Mart recently shuttered its online video download service. Even Apple has only sold 7 million movies on its download-to-own movie service on iTunes in the last year. “That’s more than everyone else put together, but it did not meet our expectations. We think there is a better way to deliver movie content,” Mr. Jobs said.

Under the rental service, library titles cost $2.99 and new releases cost $3.99. Consumers will be able to watch the movies within 30 days of renting them, but the film must be watched within a 24-hour period.

“This will be a transformative version of the rental model, and we are very excited about it,” said Jim Gianopulos, chairman and CEO of 20th Century Fox, who joined Mr. Jobs on stage.

Mr. Jobs said he expects there to be 1,000 movies in the rental store by the end of February. The movies can be watched on a PC, Mac, iPod or iPhone. Consumers can start watching within 30 seconds of starting the download. “You can transfer while watching,” he said. “You can watch the first half on your computer, realize you have a flight to catch and transfer to your iPod.”

Mr. Jobs also announced a new version of Apple TV at a reduced price.

Apple TV is a device that lets consumers watch iTunes content on their TV sets, but it has failed to take off to a meaningful degree.

“We tried with Apple TV and designed it to be an accessory to iTunes and your computer. That’s not what people wanted. What people wanted was movies, movies, movies. We weren’t delivering that,” Mr. Jobs said.

The addition of movies to the device may give it a boost in the marketplace. Consumers can rent movies from the new iTunes rental store using Apple TV.

The updated Apple TV offering is available as a free software download to existing Apple TV users. The device now sells for $229, down from $299.

Mr. Jobs also said iTunes has sold more than 125 million TV shows since it began offering them more than two years ago.


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Comments (1)

The comment that struck me is "movies can be watched on a PC, Mac, iPod or iPhone." if limited to these platforms, the rental service will be limited. The service that gives the user a good solution for the last 10 foot problem (i.e. how to get the digital files onto the home TV screen) will be a winner. If Apple offered a simple docking solution that allowed download to iPod then dock + playback on the living room plasma this could be the category killer.

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